FIRS Directs Banks and Agencies to Comply with Tax Deduction Rules

The Federal Inland Revenue Service (FIRS) has issued a directive to banks and agencies, emphasizing strict compliance with tax deduction rules to avoid penalties. The directive, signed by FIRS Executive Chairman Zacch Adedeji, mandates adherence to withholding tax regulations on interest earned on securities.

The move aligns with Sections 78(1) and 81(1) of the Companies Income Tax Act, ensuring transparency and accountability in the tax process. Notably, the directive exempts interest earned on bonds issued by the Federal Government from withholding tax, promoting sovereign debt instruments.

FIRS aims to enhance tax compliance and safeguard taxpayers' rights through these measures.